iPhone X2 could cost you much less than last year's model

Cheaper components could drop the price

We’ve heard that Apple is intending to bring out three new iPhone models this year, but it could offer a chance to own its iPhone X2 / iPhone XI for slightly less.

Rumors abound that we’ll be seeing a 5.85-inch ‘bezel-free’ model, while reports suggest there will be another with a similar design with a 6.45-inch display.

According to a report in Digitimes, research into the supply chain has suggested that Apple has managed to secure a 10% reduction in the cost of key components, meaning the expense of actually making the phone will be cheaper.

The report states that Apple has possibly canned plans to make an LCD version of the iPhone X as it’s managed to secure a better price for the OLED displays, technology that offers better color reproduction and improved contrast ratios.

This, combined with a general lowering of the cost of components over the year, would allow Apple to position the 6.45-inch iPhone X as the premium model, with the 5.85-inch option offering a lower cost of entry for consumers.

Alongside these two OLED-shod models will be a 6.1-inch LCD-powered iPhone, which could be another version of the plus-size iPhone - possibly called the iPhone 9 Plus.

The report states that the 5.85-inch iPhone could be cheaper than this model though, as Apple is reportedly sampling cheaper components in its makeup.

Will the new iPhone X actually be cheaper though?

Just because Apple is reducing the cost of making the iPhone X, it doesn’t automatically follow that we’ll be seeing it sold for £100 / $100 less.

The Digitimes report states that the iPhone X’s cost of manufacture is near to $400 (around £285 / AU$520), so even a 10% drop would only mean it would cost $40 less to make each phone.

Apple may also make savings through a reduced R&D need (a lot of the techniques to manufacture the phone would have been refined) although marketing spend will probably remain the same or even go higher, as Apple reinforces its position in the premium smartphone sector or pushes a new feature of the devices.

All these things go into the eventual price of a smartphone - for comparison, the Samsung Galaxy S8 cost $300 to make (according to IHS Markit) and was sold for $750 (£739, around AU$1300), where the iPhone X cost $999 / £999 / AU$1579 off the $400 cost.

Apple has been known for commanding a high margin on its smartphones, so it’s feasible that it might not shift the base price of the iPhone X2 as it reinvests the costs into future models.

However, with three models on show, the larger iPhone X2 (which will likely have the Plus moniker stuck alongside) will be the headline model, offering the greatest spec and performance, and Apple may strip out some of the high-end camera and performance features to bring it to a lower price point.

We’re expecting the Apple iPhone X2 release date to be early September this year, so we’ve got less than half a year to wait.